Osborne's "progressive" budget challenged by IFS, Fawcett Society

Written by Bill Heaney Wednesday, 25 August 2010

The Institute for Fiscal Studies released a report on Wednesday saying Chancellor George Osborne's June 2010 budget was "generally regressive", challenging Osborne's claims that his budget would hit the richer harder than the poorest.

The IFS said the cumulative effect of benefit cuts announced by the Department for Work and Pensions plus tax changes announced in the budget "hit the poorest households more than those in the upper-middle of the income distribution in cash, let alone percentage, terms."

"The Chancellor claimed in his Budget speech that the June 2010 Budget was a 'progressive Budget', backed up by distributional analysis in the Budget documentation that showed that tax and benefit changes due to come into effect between now and 2012-13 will hit the richest more than the poorest," a press release from the IFS said.

"IFS researchers have previously cast doubt on this claim, noting that the main measures which will lead to losses amongst better-off households were announced by the previous government, and that the reforms to be in place by 2014-15 are generally regressive.

"The distributional analysis in the Budget documents also excluded the effects of some cuts to housing benefit, Disability Living Allowance and tax credits that will tend to hit the bottom half of the income distribution more than the top half."

You can read the full text of the press release here.

Meanwhile, the Fawcett Society has challenged the budget on the grounds that it would unfairly affect more women than men, filing papers with the High Court to seek a judicial review.

"Even a top line assessment of the budget measures show 72 per cent of cuts will be met from women's income as opposed to 28 per cent from men's," the Fawcett Society says on its website.

In not assessing the way in which the budget will impact differently on women and men, the UK’s leading campaign for equality between women and men says the Treasury has not met the requirements of the Gender Equality Duty, under sections 76A and 76B of the Sex Discrimination Act 1975.

"Successive governments have failed to give enough consideration to how their policies will impact on equality between men and women, but this budget shows a whole new level of disregard for the importance of equality law and everyday women's lives," said Ceri Goddard, Chief Executive of the Fawcett Society.

Read the full press release here.